03/24/2010 05:12 am ET Updated May 25, 2011

Can Marchionne be the New Iacocca at Chrysler?

More than Italian heritage links Sergio Marchionne, the Fiat chief who also heads Chrysler, with his illustrious predecessor Lee Iacocca. Separated by 30 years, both men arrived at Chrysler in their 50s, facing the challenge of rescuing a company that quite literally was at death's door. Each believed a turnaround was possible, but acknowledged that it would require time, hard work and inspired leadership.

By one measure, Iacocca's job was harder. In 1979 he and his team spent months winning over disparate stakeholders to put together the government bailout that kept Chrysler alive. By contrast, in June 2009, Marchionne was the last chance for a much smaller Chrysler that had already passed through a sanitized bankruptcy and had been stripped of its liabilities. The blunt speaking Italian who grew up in Canada has only his time and reputation to lose in this deal. Fiat has gotten, for free, a U.S. distribution network and a 20 percent ownership that will rise significantly if the new Chrysler makes money.

Both men inherited a company bereft of the vehicles needed to excite customers and spur a turnaround. In Iacocca's case, it was over a year before his econo-box, the K car, arrived in showrooms. The bold minivan that Iacocca pioneered -- which would consolidate Chrysler's turnaround -- came two years later. Similarly Marchionne, at the Detroit auto show, was reduced to pleading for time. Attired in his trademark black sweater, he told Nancy Pelosi and other VIPs from Washington that new models would be arriving by the year's end.

Iacocca famously observed that decisiveness makes a manager. "You can have the fanciest computers in the world set the numbers," he said, "but in the end you have to set a timetable and act." Marchionne, facing what critics say is mission impossible, has set a timetable for recovery. He says there is enough cash to get through the difficult months ahead. Chrysler, he promises, will break even by year's end and show a profit in 2011. North American sales, down 36 percent in 2009, are to double by 2014.

To his numerous skeptics these predictions are pure bravado. Few analysts regard Chrysler's marriage with Fiat as viable. Ridicule is heaped on a central pillar of Marchionne's strategy, the belief that the tiny Fiat 500--a trendy top seller in Europe--will be a home run in the American market. Now being rushed into production in Mexico, the 500 will have its larger engines made in Michigan. U.S. and Canadian plants will build redesigned Chryslers, Jeeps, Ram pickups and perhaps Alfa Romeos. All this, say the critics, is bound to fail as "Fix it Again, Tony" returns to the USA. If ten years in the strong hands of Germany's Daimler couldn't save Chrysler, they ask, how can lowly Fiat succeed?

Marchionne acknowledges that the task is enormous. There is, he says, "no magic solution ... we need to keep our heads down ... execute and deliver." Chrysler employees, he says, understand "that this is their last chance." But he adds, "we've done this before."

Marchionne is used to adversity and being underestimated. When he arrived in Turin in 2004, few gave him much chance of rescuing Fiat, which was enduring its own crisis with the demise of the long-dominant Agnelli family. Marchionne's success came in large part from the unexpected popularity of the 500, as well as $2 billion in compensation received from General Motors for ending its alliance with Fiat.

In a December talk in Washington, Marchionne commended the Obama administration for "a courageous non-protectionist approach" to restructuring the U.S. auto industry. Unlike Europe, he said, the U.S. is tackling, head-on, the problems of competitiveness and excess capacity, something the Europeans refuse to do. He sees global consolidation and restructuring as essential to overcoming inefficiency and surplus capacity.

The prized possession of Walter Chrysler, the mechanical wizard who created Chrysler in 1924, was the toolbox and tools he crafted growing up in rural Kansas. Chrysler insisted on taking machines apart and learning how they worked. His talent for attracting top engineers led to the company's early reputation for quality and innovation.

Iacocca, the best known of Walter Chrysler's successors, was a Lehigh educated engineer with immense talent for marketing. He also understood style, as exemplified in the legendary Mustang he introduced at Ford. Marchionne carries a different tool box. He's been in the car business only six years. His training is in accounting and law, followed by an MBA. Marchionne aspires to being a world-class manager. With one turnaround under his belt, he hopes to register another at Chrysler and match the achievement of Lee Iacocca 30 years earlier. To my mind, if anyone can pull this off it's Marchionne.